nep-geo New Economics Papers
on Economic Geography
Issue of 2005‒07‒18
twelve papers chosen by
Vassilis Monastiriotis
London School of Economics

  2. AGGLOMERATION AND THE ADJUSTMENT OF THE SPATIAL ECONOMY By Pierre Philippe Combes; Gilles Duranton; Henry G. Overman
  3. Latent and actual entrepreneurship in Europe and the US: some recent developments By Roy Thurik; Isabel Grilo
  4. Determinants of entrepreneurial engagement levels in Europe and the US By Roy Thurik; Isabel Grilo
  5. Regional Dependencies in Job Creation: An Efficiency Analysis for Western Germany By René Fahr; Uwe Sunde
  6. Inter-Regional Wage Dispersion in Portugal By José António Cabral Vieira; João Pedro Almeida Couto; Maria Teresa Borges Tiago
  7. Growth, Technological Interdependence and Spatial Externalities: Theory and Evidence. By ERTUR, Cem; KOCH, Wilfried
  8. Croissance, capital humain et interactions spatiales : une étude économétrique. By ERTUR, Cem; THIAW, Kalidou
  9. Specialization and Geographical Concentration in East Asia: Trend and Industry Characteristics By Soon-Chan Park
  10. Geographic Concentration and Industry Characteristics: An Empirical Investigation of East Asia By Soon-Chan Park,; Hongshik Lee,; Mikyung Yun
  11. Unit root and cointegration tests for cross-sectionally correlated panels.Estimating regional production functions By Roberto Basile, Mauro Costantini, Sergio Destefanis
  12. Determinants of Technical Efficiency in Agriculture and Cattle Ranching: A Spatial Analysis for the Brazilian Amazon By Danilo Camargo Igliori

  1. By: Fabio Sánchez; Mariana Martínez; Carolina Mejía
    Abstract: Durante los años noventa, el auge de petróleo en el Casanare provocó una serie de cambios económicos, fiscales y demográficos acelerados en este departamento. En primer lugar, el departamento ha experimentado una profunda transformación en su estructura económica, pasando de ser una economía agrícola a ser una economía dependiente del petróleo. En segundo lugar, el departamento atraviesa una difícil situación de seguridad y orden público evidenciada en un aumento en homicidios, secuestro, extorsión, ataques terroristas y ataques a la población civil. En tercer lugar, el petróleo mejoró notablemente las finanzas públicas tanto del departamento como de los municipios, gracias a las regalías transferidas. No obstante, la estructura del gasto público existente no es sostenible en el largo plazo y en caso de una disminución o agotamiento del recurso, el futuro económico del departamento es incierto. De igual forma, la explotación de los yacimientos petroleros fomentó altas tasas de crecimiento urbano y una mayor demanda de servicios públicos y de vivienda, especialmente en ciudades como Yopal, Aguazul y Tauramena. También causó flujos migratorios significativos, debido tanto al diferencial de salarios entre el sector petrolero y el resto de sectores de la economía como al auge económico que tuvo el departamento precisamente como resultado del auge petrolero.
    Keywords: economía regional
    JEL: R11
    Date: 2005–04–15
  2. By: Pierre Philippe Combes; Gilles Duranton; Henry G. Overman
    Abstract: We consider the literatures on urban systems and New Economic Geography to examine questions concerning agglomeration and how areas respond to shocks to the economic environment. We first propose a diagrammatic framework to compare the two approaches. We then use this framework to study a number of extensions and to consider several policy relevant issues.
    Keywords: Urban systems
    JEL: R00
    Date: 2005–04–20
  3. By: Roy Thurik; Isabel Grilo
    Abstract: This paper uses 2004 survey data from the 15 old EU member states and the US to explain country differences in latent and actual entrepreneurship. Other than demographic variables such as gender, age and education, the set of covariates includes the perception by respondents of administrative complexities, of availability of financial support and of risk tolerance as well as country-specific effects. A comparison is made with results using a similar survey in 2000. While a majority of the surveyed population identifies lack of financial support as an obstacle to starting a new business, the role of this variable in both latent and actual entrepreneurship appears to be even more counterintuitive in 2004 than in 2000: it has no impact on actual entrepreneurship and is positively related to latent entrepreneurship. Administrative complexities, also perceived as an obstacle by a large majority of the population, have the expected negative impact both for latent and actual entrepreneurship in both years. Country-specific effects are important both for latent and actual entrepreneurship and the comparison of 2000 and 2004 results suggests that, once all other factors are controlled for, an improvement in actual entrepreneurship in the EU relative to the US has taken place in the last four years. However, in terms of unweighted averages actual entrepreneurship remained about the same. Latent entrepreneurship dropped while this drop seems to have occurred evenly in the US and the EU member states.
    Keywords: entrepreneurship; latent entrepreneurship; nascent entrepreneurship; determinants; Europe
    JEL: M13 H10 J23 R12
    Date: 2005–07
  4. By: Roy Thurik; Isabel Grilo
    Abstract: Determinants from different streams of literature and spanning different disciplines are used to explain entrepreneurial decisions. A multinomial logit model and survey data from the old 15 EU member states, Norway, Iceland, Liechtenstein and the US are used to establish the effect of demographic and other variables on various entrepreneurial engagement levels. These engagement levels range from "never thought about starting a business" to "thinking about it", "taking steps for starting up", "having a young business", "having an older business" and "no longer being an entrepreneur". Data of two Entrepreneurship Flash Eurobarometer surveys (2002 and 2003) containing over 20,000 observations are used. Other than demographic variables, the set of explanatory variables used includes the perception by respondents of ad-ministrative complexities, of availability of financial support and of risk tolerance, the respondents' prefer-ence for self-employment and country specific effects. The most striking result is that the perception of lack of financial support has no discriminative effect across the various levels of entrepreneurial engagement.
    Keywords: entrepreneurship, determinants, nascent entrepreneurship, multinomial logit, barriers to entry, Europe
    JEL: M13 H10 J23 R12
    Date: 2005–06
  5. By: René Fahr (University of Cologne and IZA Bonn); Uwe Sunde (IZA Bonn)
    Abstract: This paper investigates the efficiency of the matching process between job seekers and vacancy posting firms in West-Germany, using variation across labor market regions and across time. The results of a stochastic frontier analysis shed new light on extent and regional differences of search frictions, on potential determinants of frictional inefficiencies and on the consequences of German reunification for the matching process. The paper also presents novel evidence on the complex interactions between spatial contingencies among regional labor markets: matching efficiency decreases with spatial autocorrelation in hiring, implying indirect evidence for crowding externalities.
    Keywords: regional unemployment, stochastic frontier, matching function, spatial autocorrelation
    JEL: J61 J64 J21 R12
    Date: 2005–07
  6. By: José António Cabral Vieira (University of the Azores and IZA Bonn); João Pedro Almeida Couto (University of the Azores); Maria Teresa Borges Tiago (University of the Azores)
    Abstract: This paper examines the size o inter-regional wage dispersion in Portugal. For this purpose, we estimate a Mincer-type human capital wage equation, including controls for a large number of regions, and calculate a weighted and adjusted standard deviation (WASD) of inter-regional wage differentials. The value is high and quite stable over time. The highest wages are found in the region of Lisbon. Moreover, the results are quite sensitive to inclusion of human capital and industry controls. A decomposition analysis reveals that differences average years of education and in the return to education across regions account for a significant fraction of observed wage differentials.
    Keywords: regions, wages, human capital, Portugal
    JEL: J31 R10
    Date: 2005–07
  7. By: ERTUR, Cem (LEG - CNRS UMR 5118 - Université de Bourgogne); KOCH, Wilfried (LEG - CNRS UMR 5118 - Université de Bourgogne)
    Abstract: This paper presents a theoretical model, based on the neoclassical growth literature, which explicitly takes into account technological interdependence among economies and examines the impact of location and neighborhood effects in explaining growth. Technological interdependence is supposed working through spatial externalities. The magnitude of the physical capital externalities at steady state, which is usually not identified in the literature, is estimated using a spatial econometric specification explaining the steady state income level. This spatially augmented Solow model yields a conditional convergence equation which is characterized by parameter heterogeneity. A locally linear spatial autoregressive specification is then estimated.
    Keywords: Conditional convergence ; technological interdependence ; spatial externalities ; spatial autocorrelation ; parameter heterogeneity ; locally linear estimation
    JEL: C14 C31 O4
    Date: 2005–07
  8. By: ERTUR, Cem (LEG - CNRS UMR 5118 - Université de Bourgogne); THIAW, Kalidou (LEG - CNRS UMR 5118 - Université de Bourgogne)
    Abstract: The aim of this paper is to analyze the theoretical and econometric implications of omitting spatial dependence in the Mankiw, Romer, and Weil (1992) model. Indeed, the international distribution of income levels and growth rates suggests the existence of large international disparities, and therefore the important role of location on economic performance. However, taking spatial dependence into account requires resorting to the methods of Spatial Econometrics, not only for a valid statistical inference, but also for revaluating the impact of the variables generally considered as crucial in the growth phenomenon and finding the processes underlying growth rates and income levels. / L'objectif de cet article est d'analyser les implications économétriques et théoriques de l'omission de la dépendance spatiale dans le cadre de l'estimation du modèle de Mankiw, Romer et Weil (1992). En effet, la distribution internationale des taux de croissance et des niveaux de revenu suggère l'existence de bassins de croissance et de récession, et donc un rôle important de la localisation dans les performances économiques. Cependant, la prise en compte de l'autocorrélation spatiale dans l'estimation nécessite de recourir aux méthodes de l'économétrie spatiale afin, non seulement d'obtenir une inférence statistique valide, mais également d'élucider les processus qui sous-tendent la détermination des rythmes de croissance et des niveaux de revenu.
    Keywords: Economic growth ; Human capital ; convergence ; spatial econometrics ; Croissance économique ; capital humain ; convergence ; économétrie spatiale
    JEL: C14 C31 O4
    Date: 2005–07
  9. By: Soon-Chan Park (Korea Institute for International Economic Policy)
    Abstract: In this paper, we examine changes in patterns of specialization and geographical concentration in East Asia. we found that relative specialization, on average, has decreased in East Asia, implying that the economic structures of East Asian countries have been converging. Investigation in the industrial characteristics, it is shown that the differences in economies of scale between east Asian countries have been greatly reduced over time. I addition, we also identified that geographical concentration has increased. During the 1989/91-1995/96 period, 17 industries experience the increase of geographical concentration more than 10 percent, while only three industries show the decline in geographical concentration more than 10 percent. The industries with increased concentration are characterized by above the medium level of economies of scale, capital and skill intensity. In comparison with the United States and the EU, East Asian countries show a low level of specialization and concentration. Thus, if East Asia countries follow the development patterns of the more integrated regions, a regional trading agreement in this region may lead to further specialization and concentration.
    Keywords: Economic geography, specilization, industrial concentration
    JEL: C21 F14 F15
    Date: 2003–12
  10. By: Soon-Chan Park, (Korea Institute of International Economic Policy); Hongshik Lee, (Korea Institute of International Economic Policy); Mikyung Yun (Korea Institute of International Economic Policy)
    Abstract: In this paper we assess the geographic concentration of 26 manufacturing industries over the 1986-1997 period, based on annual employment data for 8 East Asian countries. The average level of geographic concentration, in the relative term, has decreased continuously during the period in this regio. We show that intra-industry linkage and inter-industry linkage have a positive and significant influence on relative concentration. Furthermore, the industries with large demand bias, high scale intensity and low capital intensity are geographically concentrated. Finally, we find the evidence that regional integration in East Asia will lead to agglomeration of industries.
    Keywords: economic integration, location of industries, economic geography, industry characteristics
    JEL: F12 F13
    Date: 2004–12
  11. By: Roberto Basile, Mauro Costantini, Sergio Destefanis (ISAE, Roma – Università di Macerata, ISAE, Roma – Università “La Sapienza” di Roma, CELPE, CSEF – Università di Salerno)
    Abstract: This paper employs recently developed non stationary panel methodologies that assume some cross-section dependence to estimate the production function for Italian regions in the industrial sector over the period 1970-1998. The analysis consists in three steps. First, unit root tests for cross-sectionally dependent panels are used. Second, the existence of a co-integrating relationship among value added, physical capital and human capital-augmented labor is investigated. The Dynamic OLS (DOLS) and Fully modified (FMOLS) estimators developed by Pedroni (1996, 2000, 2001) and the Panel Dynamic OLS (PDOLS) estimator proposed by Mark and Sul (2003) are then used to estimate the long run relationship between the variables considered.
    Keywords: panel cointegration, cross-section dependence, production function.
    JEL: C33 C15 D24
    Date: 2005–05
  12. By: Danilo Camargo Igliori (Department of Land Economy, University of Cambridge, UK)
    Abstract: The determinants of technical efficiency in agriculture and cattle ranching are closely related with the debate involving the conservation-development trade-off in the Brazilian Amazon. Concerned with balancing development and environmental conservation, policy makers and academics have emphasized the importance of choosing ways of selecting areas where land use restrictions would be established. In order to understand the relationship between spatial patterns of deforestation and the associated distribution and characteristics of economic activity, issues regarding technical efficiency are clearly important. This paper aims to identify the socio-economic and environmental determinants of technical efficiency in agriculture and cattle ranching in the Brazilian Amazon emphasizing their relationship with spatial processes of deforestation and development. The study is structured in two parts. The first part is concerned with measuring technical efficiency for agriculture and cattle ranching in each geographical unit focusing on the production relationship between inputs and outputs. The second one focuses on the variation in the efficiency measure explained by exogenous factors and includes the spatial analysis. We adopt the model proposed by Battese and Coelli (1995) where the production function and the exogenous effects influencing technical efficiency are estimated simultaneously.
    Keywords: stochastic frontier, technical efficiency, spatial analysis, Brazilian Amazon
    Date: 2005–06

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